Neptune Energy acquires 20% stake in East Sepinggan area in Indonesia

UK-based Neptune Energy has completed its previously announced acquisition of 20% stake in the East Sepinggan area offshore Indonesia from Eni for an undisclosed sum.

The East Sepinggan area contains the Merakes development and Merakes East discovery, located offshore East Kalimantan.

The deal, which was signed in July 2019, also involved the acquisition of a 30% stake in the East Ganal production sharing contract (PSC) from the Italian oil and gas giant.

Eni will continue to serve as the operator of the East Sepinggan area with a reduced stake of 65%. Pertamina Hulu Energi East Sepinggan and Neptune Energy East Sepinggan now hold stakes of 15% and 20%, respectively in the offshore Indonesian block.

The Merakes field will have a subsea tie-back to the Jangkrik floating production unit and will be developed through the drilling and construction of half a dozen subsea wells in 1500m water depth.

The Merakes East discovery, on the other hand, is expected to give Neptune Energy extra contingent resources that can be potentially developed in the near-term.

Neptune Energy acquires 20% stake in East Sepinggan area in Indonesia. Image courtesy of jorono from Pixabay.

As per the Eni, the transaction is in line with its dual exploration model, which seeks the sale of minority stakes in the company’s exploration assets while maintaining operatorship and control in them and also in development and discovered reserves.

The dual exploration model of the Italian oil and gas giant also aims to optimize the supply chain while lowering the costs.

Currently, Eni and Neptune Energy are joint venture partners in the Muara Bakau area in Indonesia, which includes the Jangkrik deepwater field in the Kutei Basin, which began production in May 2017. The Italian oil and gas giant holds a stake of 55%, while Neptune Energy and Saka own stakes of 33.3% and 11.7%, respectively in the Muara Bakau area.